Thursday 18th Oct 2018
October 2018
Impact of
Clevedon Fasteners Ltd and Clevtec in the event of a no-deal outcome to the EU
withdrawal negotiations
We
are beginning to get letters from customers asking what our position will be in
the event of a no deal Brexit
The
following seeks to give the reader a flavour of our view on the subject
Clevedon
Fasteners Ltd use sub-contractors for Heat Treatment and Plating processes who
are predominantly local to us and all are in the UK. These entities are
relatively immune to the effects of a no deal scenario as their main drivers
are Gas (heat treatment) chemicals and Electricity (plating plant). We have our
own tool room but occasionally sub contract tooling. Again these companies are
not expecting a problem as they have well established workforces and there
their material stocks are high
The
only product we purchase from outside the UK is wire which we use to
manufacture our parts.
There
has been no suggestion in the literature available that either the UK or any of
the EU27 are expecting to cease work when we leave the EU. The main focus has
been around potential tariffs, added paperwork and delays at the border.
We
sell all over the world and so we are used to paperwork
We
hold relatively high (3 months) stock of fast moving raw material
We
source our wire from the UK, the EU and non UK companies
In
the UK, British Steel have just upgraded their rolling mill with a £50m
investment and we can switch EU product to non EU suppliers relatively easily
if we need to
The
other big unknown is the exchange rate and in the event of a no deal the GBP
will fall significantly in value in the short term, but so will the Euro,
therefore it will be pretty much the same, but lower. The fundamentals of the
UK economy are sound and any hit will be short lived as it was when the UK
voted to leave the EU
We
are in the relativity enviable position of not having to purchase anything from
outside the UK for approximately 10/12 weeks, during which time the effect of a
no-deal scenario will be well on the way to being resolved.
Not
wishing to stray into the political arena, but no matter how much of a hash the
politicians of all complexions make (and are making), in the end it all boils
down to trade and pounds, shillings and Euros.
As
things stand I believe we are well placed to cope with the short term
disruption and will be able to continue to provide the excellent service our
customers have come to expect
As
more information comes into the public domain that significantly changes our
view I will update this notice
Yours
sincerely
Steve
Hardeman
Managing
Director
PS:
Clevtec is a trading division of Clevedon Fasteners Ltd. Clevedon Fasteners Ltd
is the legal entity